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Dividend payouts and earnings season go hand in hand. Earnings season is the time each quarter when companies report their results to Wall Street, and it's also the time when those same firms typically announce changes to their dividend payouts. And with dividends setting all-time highs on the heels of another 14% boost in the
S&P 500's payouts in the last 12 months, most income investors should be feeling the love this summer.

As the broad market bumps up against new all-time highs right now, the allegation that "stocks are expensive" is getting tossed around. I think that's flawed thinking. Sure, stocks cost more now, but they pack a much bigger fundamental punch than they ever have before. Looking at drivers of shareholder value, cash and corporate profits are both at record levels right now; as companies look for ways to put that wherewithal to work in a nearly zero-rate environment, dividends are one of the few options the C-suite has.

In recent months we've had some stellar success in finding future dividend increases just by zeroing in on a few key factors. Now we'll look at our crystal ball and try to do it again.

For our purposes, that "crystal ball" is composed of a few factors: namely a solid balance sheet, a low payout ratio and a history of dividend hikes. While those items don't guarantee dividend announcements in the next month or three, they do dramatically increase the odds that management will hike their cash payouts, especially as investors start to get antsy about whether or not 2013's rally will be able to hang on.